Open Access. Powered by Scholars. Published by Universities.®
Management Information Systems Commons™
Open Access. Powered by Scholars. Published by Universities.®
Articles 1 - 2 of 2
Full-Text Articles in Management Information Systems
Pricing Online Subscription Services Under Competition, Ram Bala
Pricing Online Subscription Services Under Competition, Ram Bala
Information Systems and Analytics
In recent times, rapid advances in the field of information technology have enabled firms selling information products (for example, in the form of a CD) to provide subscription services using remote servers. Making the product versus service decision involves a trade-off. Online subscription offerings are perceived to be of lower quality because of data security and network reliability issues but can reduce or even eliminate the credible commitment (of prices) problem typically faced by firms selling durable products. We model an infinite horizon game between two symmetric firms that choose the design architecture, that is, product or service (and consequent …
Usage-Based Pricing Of Software Services Under Competition, Ram Bala, Scott Carr
Usage-Based Pricing Of Software Services Under Competition, Ram Bala, Scott Carr
Information Systems and Analytics
With the emergence of high speed networks, software firms have the ability to deploy ‘software as a service' and measure resource usage at the level of individual customers. This enables the implementation of usage-based pricing. We study both fixed and usage-based pricing schemes in a competitive setting where the firm incurs a transaction cost of monitoring usage if it implements usage-based pricing. Offering different pricing schemes helps to differentiate the firms and relax price competition, particularly at higher monitoring costs, even when competing firms offer the same service quality. However, the low usage customers acquired by offering usage-based pricing are …